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CITRIX SYSTEMS, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
F-27
Shares for Tax Withholding
During the years ended December 31, 2013, 2012 and 2011, the Company withheld 444,657 shares, 269,745 shares and
182,203 shares, respectively, from stock units that vested. Amounts withheld to satisfy minimum tax withholding obligations
that arose on the vesting of stock units was $31.0 million, $20.2 million and $13.3 million, for 2013, 2012 and 2011,
respectively. These shares are reflected as treasury stock in the Company's consolidated balance sheets and statements of equity
and the related cash outlays reduce the Company's total stock repurchase authority.
Preferred Stock
The Company is authorized to issue 5,000,000 shares of preferred stock, $0.01 par value per share. No shares of such
preferred stock were issued and outstanding at December 31, 2013 or 2012.
9. COMMITMENTS AND CONTINGENCIES
Leases
The Company leases certain office space and equipment under various operating leases. In addition to rent, the leases
require the Company to pay for taxes, insurance, maintenance and other operating expenses. Certain of these leases contain
stated escalation clauses while others contain renewal options. The Company recognizes rent expense on a straight-line basis
over the term of the lease, excluding renewal periods, unless renewal of the lease is reasonably assured.
Rental expense for the years ended December 31, 2013, 2012 and 2011 totaled approximately $70.9 million, $65.1
million and $56.5 million, respectively. Sublease income for the years ended December 31, 2013, 2012 and 2011 was
approximately $0.3 million, $0.2 million and $0.2 million, respectively. Lease commitments under non-cancelable operating
leases with initial or remaining terms in excess of one year and sublease income associated with non-cancelable subleases, are
as follows:
Operating
Leases
Sublease
Income
(In thousands)
Years ending December 31,
2014 $ 60,982 $ 255
2015 46,770 260
2016 39,353 227
2017 22,064 218
2018 18,536 203
Thereafter 88,885 —
Total $ 276,590 $ 1,163
Legal Matters
The Company accrues a liability for legal contingencies when it believes that it is both probable that a liability has been
incurred and that it can reasonably estimate the amount of the loss. The Company reviews these accruals and adjusts them to
reflect ongoing negotiations, settlements, rulings, advice of legal counsel and other relevant information. To the extent new
information is obtained and the Company's views on the probable outcomes of claims, suits, assessments, investigations or
legal proceedings change, changes in the Company's accrued liabilities would be recorded in the period in which such
determination is made. For the Other Matters referenced below, the amount of liability is not probable or the amount cannot be
reasonably estimated; and, therefore, accruals have not been made. In addition, in accordance with the relevant authoritative
guidance, for matters in which the likelihood of material loss is at least reasonably possible, the Company provides disclosure
of the possible loss or range of loss. If a reasonable estimate cannot be made, however, the Company will provide disclosure to
that effect.
On April 11, 2008, SSL Services, LLC (“SSL Services”) filed a suit for patent infringement against the Company in the
United States District Court for the Eastern District of Texas (the “SSL Matter”). SSL Services alleged that the Company
infringed U.S. Patent Nos. 6,061,796 (the “'796 patent”) and 6,158,011 (the “'011 patent”). The Company denied infringement
and asserted that the patents-in-suit were invalid. A jury trial was held on SSL Services' claims, and on June 18, 2012, the jury
found that the Company does not infringe the '796 patent and found that the Company willfully infringes the '011 patent
through the sale and use of certain products. The jury awarded SSL Services $10.0 million. On September 17, 2012, the court
issued a final judgment confirming the jury award of $10.0 million in damages and added $5.0 million in enhanced damages